ESS Tech (GWH – Research Report), the Technology sector company, was revisited by a Wall Street analyst on September 25. Analyst Ben Kallo from Robert W. Baird remains neutral on the stock and has a $4.00 price target.
Ben Kallo has given his Buy rating to ESS Tech’s stock based on several critical factors. Firstly, the strategic partnership with Honeywell is seen as a significant boost to both the liquidity situation and the go-to-market strategy for ESS Tech. The partnership will enable ESS Tech to expand its reach into new geographical markets, tap into new customer segments, and leverage existing supply chain relationships, thereby enhancing its production capacity. Furthermore, cost improvements and liquidity are continuously being prioritized as ESS Tech ramps up production to meet the increasing demand for Long Duration Energy Storage.
The deal with Honeywell is viewed favorably by Kallo as it not only involves share purchases and product prepayments, but also grants ESS Tech access to Honeywell’s R&D for energy storage and its global customer relationships. This will help unlock new market segments and geographies. Moreover, the partnership will help accelerate ESS Tech’s cost reduction initiatives and speed up its market entry with new deals. The prepayment and share purchases have also strengthened ESS Tech’s balance sheet, adding $42.5M and significantly improving liquidity. Lastly, Kallo’s price target of $4 is based on the positive view of the technology and the total addressable market, despite recognizing potential execution risks.
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ESS Tech (GWH) Company Description:
ACON S2 Acquisition Corp is a blank check company.
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